How to deal with competitors in business ?

PESTEL Analysis

PESTEL analysis is a framework for identifying and evaluating the Company's external factors.

PESTEL points.

1. Political: Government policies, political stability, regulations
2. Economic: inflation rate, interest rate, economic growth.
3. Social: lifestyle, education level, and social change.
4. Technology: New technological developments, innovations, and their impact on industry.
5. Environmental: climate change, and availability of natural resources.
6. Legal: licensing, patents, and relevant legal policies.

Purpose of PESTEL Analysis

1. Identify external factors that affect business performance.
2. Discover new business opportunities from environmental changes.
3. Identifying potential competitor threats.
4. Help management make strategic decisions.

Benefits of PESTEL Analysis

1. Makes a more realistic business plan
2. Helps identify potential risks
3. Encourages companies to develop new products and services.

Example of PESTEL Analysis on Online Transportation

1. Politics: Changes in government policies related to online transportation, regulations on tariffs, competition with public transportation.
2. Economic: Income level per capita, fuel prices
3. Social: Changes in people's lives relying on ride-hailing services
4. Technology: integration with digital payment systems.
5. Environmental: availability of alternative refueling infrastructure.
6. Legal: operational licensing.

Porter's Five Forces Analysis

Porter's Five Forces Analysis is a model of Michael Porter's science of analyzing the level of competition. This model helps companies understand the forces of competition so that they can formulate more effective business strategies.

The five main forces in Porter's Five Forces model are:

1. Intercompany Competition.
2. Threat of New Entrants
3. Threat of substitute products.
4. Buyer power to reduce prices
5. Power of suppliers to raise prices

Purpose of Porter's Five Forces Analysis

1. Identify the company's competitive position in the industry.
2. Identify strengths and weaknesses compared to competitors.
3. Formulate business strategies to achieve competitive advantage.
4. Analyze potential profitability

Example of Porter's Five Forces Analysis in a beverage business

1. Competition in soft drink companies is very high, with major brands competing fiercely on price, taste and promotion.
2. The threat of new entrants is relatively low as large investments are required.
3. The threat of substitute products is high, such as mineral water, fruit juice, and energy drinks.
4. The bargaining power of buyers is relatively high due to the large selection of products available in the market.

Benefits of Porter's Five Forces Analysis

1. Helps make better strategic decisions.
2. Helps the company become more competitive.
3. Reduces risk
4. Strengthens market position

Purpose of Competitor Analysis

1. Comparing the company's position with competitors to identify strengths and weaknesses.
2. Find new market opportunities and anticipate threats from competitors.
3. Formulate business strategies that can differentiate the company from competitors.
4. Identifying market areas that can improve operating efficiency.
5. Analyze possible future actions of competitors.

Example of Competitor Analysis in the field of e-commerce.

1. Determine who the main competitors are in the e-commerce market
2. Comparing the products, prices, service quality, and marketing strategies of each competitor.
3. Study competitors' marketing strategies, pricing strategies, and product development strategies.
4. Identify competitor advantages.